Redistribution, taxes, and the median voter

Marco Bassetto, Jess Benhabib

    Research output: Contribution to journalArticle

    Abstract

    We study a simple model of production, accumulation, and redistribution, where agents are heterogeneous in their initial wealth, and a sequence of redistributive tax rates is voted upon. Though the policy is infinite-dimensional, we prove that a median voter theorem holds if households have identical, Gorman aggregable preferences; furthermore, the tax policy preferred by the median voter has the "bang-bang" property.

    Original languageEnglish (US)
    Pages (from-to)211-223
    Number of pages13
    JournalReview of Economic Dynamics
    Volume9
    Issue number2
    DOIs
    StatePublished - Apr 2006

    Fingerprint

    Redistribution
    Tax
    Tax rate
    Wealth
    Household
    Median voter
    Median voter theorem
    Tax policy

    Keywords

    • Capital income taxes
    • Gorman aggregation
    • Median voter
    • Redistribution

    ASJC Scopus subject areas

    • Economics and Econometrics

    Cite this

    Redistribution, taxes, and the median voter. / Bassetto, Marco; Benhabib, Jess.

    In: Review of Economic Dynamics, Vol. 9, No. 2, 04.2006, p. 211-223.

    Research output: Contribution to journalArticle

    Bassetto, Marco ; Benhabib, Jess. / Redistribution, taxes, and the median voter. In: Review of Economic Dynamics. 2006 ; Vol. 9, No. 2. pp. 211-223.
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